@PrestonFitzgerald Let's say that from an economic point of view, auctions (especially lowest-bid auctions) are seldom optimal, even if the market has all the nice attributes Adam Smith assumed in his basic theory.

I am too tired to pull out my first semester microeconomics book to look up the details, and besides, it's been so long since I studied this stuff that I'd need a lot of time to understand the details again

A Vickrey auction is a type of sealed-bid auction. Bidders submit written bids without knowing the bid of the other people in the auction. The highest bidder wins but the price paid is the second-highest bid. The auction was first described academically by Columbia University professor William Vickrey in 1961 though it had been used by stamp collectors since 1893. This type of auction is strategically similar to an English auction and gives bidders an incentive to bid their true value.
Vickrey's original paper mainly considered auctions where only a single, indivisible good is being sold...

I think this is the simplest auction which delivers optimal results under optimal conditions. The simpler ones don't deliver optimal results even when the conditions are optimal.

As for real-world contracts, the matter gets messy. Not only do you have asymmetrical information, you also have biased decision makers. Lobbyists are a problem, of course. But there would be problems even without them.